registerme
Member of DD Central
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Post by registerme on Sept 6, 2015 19:24:34 GMT
I suggest we all attend the meeting in September and voice our concerns. Maybe FC will discard this ridiculous change idea. I couldn't believe it when I saw this change announcement. If it 'ain't broke, don't fix it. Then they go and try to fix it. SMH. The model at least. The website, that's another story. But it is broke!!! The number of loans available is limited and large loans (> £200k) are hard to get away because they end at high rates. FC really do not want to mess about with £6000 tax bills, they want the £500k loans to build income and reach profitability. The thing is though, if their credit model was up to snuff, they could just package it all up into arbitrary sized buckets and sell us pieces of each aggregate loan - securitisation lite if you will. This would:- a) simplify things for FC b) simplify things for us lenders c) eliminate the illusion of us having any control Sure, it ends up looking like Zopa, but isn't that the inevitable end point once they've taken this first step? Not being able to differentiate by price renders everything else rather moot.
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jonah
Member of DD Central
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Post by jonah on Sept 6, 2015 19:33:26 GMT
Add in a PF and a reasonable rate and you have a product similar to GBBA.
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Post by Financial Thing on Sept 6, 2015 19:42:33 GMT
I suggest we all attend the meeting in September and voice our concerns. Maybe FC will discard this ridiculous change idea. I couldn't believe it when I saw this change announcement. If it 'ain't broke, don't fix it. Then they go and try to fix it. SMH. The model at least. The website, that's another story. But it is broke!!! The number of loans available is limited and large loans (> £200k) are hard to get away because they end at high rates. FC really do not want to mess about with £6000 tax bills, they want the £500k loans to build income and reach profitability. I dont like it, especially as I am currently running at 12.7% return, but I cannot get more than pennies invested if there are no new loans available (while maintaining diversity). I do think the rates are too low, but the 75 -ve votes (including mine) are hardly going to tip the balance. Imagine 200 or 300 loans a week at auction, the system could not cope, and even a wholly new IT structure might struggle. And good look pulling out and going elsewhere, the 12% offers are all constrained by excess demand. I don't understand what you mean by "hard to get away"? What don't you like? Would you rather get 7% instead of 12.7%? The inflow of new loans is much greater than all the other b2b sites I use (REBS, Thincats, Lending Crowd) I think you misunderstood my post. I'm saying that changing the system to the new proposed way will break FC. I like the way it is now, except for the website which sucks. I think a room full of the forum users voicing their opinions as investors could make a difference. If we don't speak up, why complain.
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am
Posts: 1,495
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Post by am on Sept 6, 2015 21:03:41 GMT
The mail documentation points out that less loans will be rejected as the borrower can be certain of the rate and that's good for lenders. This may well morph into pre-acceptance of loans which will also be better for lenders. On the other side of the coin, if at the moment, a loan is not going to be filled, normally because the proposition is unattractive, then the active investors swoop in with a high rate offer commensurate with the risk and the loan gets filled. So I surmise that more loans will remain unfilled than before, particularly at the current advertised rates, and that's got to be a bad thing. Of course, it may be that FC then top it up (although that would appear to me to be very unethical), but if all the active investors steer clear of a loan request and FC tops it up, that's a quick journey to the knackers yard. I don't see FC underwriting SME loans as unethical. (They're already underwriting second and subsequent tranches of property loans.) If FC were to place trust in their credit rating algorithm rather than the wisdom of the crowd, and underwrite SME loans, then yes they likely to end up with a portfolio of less than average quality. But no, it's not likely to break the company - something like 4% net return instead of 7% seems a more likely scenario. What would be questionable would be using the proposed FC Investment Trust as an underwriter.
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Post by davee39 on Sept 7, 2015 8:47:52 GMT
Large loans are hard to get away because they inevitably end up at higher rates. These rates are less attractive to borrowers and are more likely to be rejected.
P2P was new when Zopa originated the concept, but it needs to evolve so the platforms can make sufficient profit to remain financially viable and eventually become mainstream.
FC provided 'gaming' opportunities where selective bidding and flipping could significantly enhance returns but this would be at the expense of the MBR bidders. In a regulated world
fairness and equality inevitably leads to a new model. FC cannot make a profit at the current loan level so there needs to be a significant scaling up of loan activity.
Additionally the Q&A must be off putting to some legitimate businesses,especially those which would genuinely like to remain anonymous.
Just as interesting is the dismal failure of the smaller competitors to provide an adequate deal flow and the question mark over their long term survival.
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arbster
Member of DD Central
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Post by arbster on Sept 7, 2015 9:00:02 GMT
Additionally the Q&A must be off putting to some legitimate businesses,especially those which would genuinely like to remain anonymous. My concern is that the Q&A was a valuable source of information when making my investment decisions - with borrowers less incentivised to answer any questions, I may find myself unwilling to invest in otherwise promising opportunities. That said, so long as the Q&A remains a feature on the site, "good" borrowers should still engage with the lending community. Hopefully.
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baldpate
Member of DD Central
Posts: 549
Likes: 407
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Post by baldpate on Sept 7, 2015 9:13:51 GMT
Several people have mentioned the Funding Circle Investment Trust as something that has already been proposed/mooted/discussed. I don't remember seeing mention of it, though. Would some kind soul please post a link to where it has been discussed? Thanks.
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SteveT
Member of DD Central
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Post by SteveT on Sept 7, 2015 9:17:27 GMT
Several people have mentioned the Funding Circle Investment Trust as something that has already been proposed/mooted/discussed. I don't remember seeing mention of it, though. Would some kind soul please post a link to where it has been discussed? Thanks. I haven't mastered the art of inserting links to other threads (tips, anyone?) but I've just bumped in up the thread list for you.
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baldpate
Member of DD Central
Posts: 549
Likes: 407
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Post by baldpate on Sept 7, 2015 9:24:00 GMT
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Post by mostlywrong on Sept 7, 2015 9:28:32 GMT
Several people have mentioned the Funding Circle Investment Trust as something that has already been proposed/mooted/discussed. I don't remember seeing mention of it, though. Would some kind soul please post a link to where it has been discussed? Thanks. I haven't mastered the art of inserting links to other threads (tips, anyone?) but I've just bumped in up the thread list for you. Open the thread to which you want to link, click on the address bar so that the whole address is highlighted, hold down the CTRL key and press C. OR - right click and select Copy. Navigate to the thread to which you wish to contribute, click on the Quote or Reply buttons, compose your message, locate the cursor where you wish to place the liink, hold down the CTRL key and press V. OR right click and select Paste. Once you have done that a couple of times, it becomes second nature... Honest! MW
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ilmoro
Member of DD Central
'Wondering which of the bu***rs to blame, and watching for pigs on the wing.' - Pink Floyd
Posts: 11,329
Likes: 11,549
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Post by ilmoro on Sept 7, 2015 9:47:42 GMT
Several people have mentioned the Funding Circle Investment Trust as something that has already been proposed/mooted/discussed. I don't remember seeing mention of it, though. Would some kind soul please post a link to where it has been discussed? Thanks. I haven't mastered the art of inserting links to other threads (tips, anyone?) but I've just bumped in up the thread list for you. If you click on toothed wheel at the top right hand corner of the post you're looking to link to, it offers you a link option, click it and a box will appear somewhere on the page with a link to the thread or just the post. Copy the one you want, then compose your post and insert either by pasting or use the insert link button in the top menu ( former puts in link, second lets you create a text holder for the link) If you select the 'thread' link it will link to the specific post you want and then all following posts, the other just links to the post. Edit: unsurprising my tablet isnt a fan of pasting in this forum, at least not where I want it, so link button is vital, or I just note the post number & type the address.
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Post by mostlywrong on Sept 7, 2015 14:02:24 GMT
I haven't mastered the art of inserting links to other threads (tips, anyone?) but I've just bumped in up the thread list for you. If you click on toothed wheel at the top right hand corner of the post you're looking to link to, it offers you a link option, click it and a box will appear somewhere on the page with a link to the thread or just the post. Copy the one you want, then compose your post and insert either by pasting or use the insert link button in the top menu ( former puts in link, second lets you create a text holder for the link) If you select the 'thread' link it will link to the specific post you want and then all following posts, the other just links to the post. Edit: unsurprising my tablet isnt a fan of pasting in this forum, at least not where I want it, so link button is vital, or I just note the post number & type the address. That is a far more elegant method than mine... One learns something new every day! Have a "like" (which was last week's newly learned thing)! MW
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Post by biscuitbri on Sept 8, 2015 19:02:09 GMT
Hi All,
Although an avid browser of the site I have just joined so that I can add my comments.
I am so disillusioned with the FC change that I have more or less liquidated my portfolio with a view to moving it elsewhere. I like the look of Lending Crowd, although small and relatively new, they are friendly, treat you like a person and are really trying to attract enough new members to offer a larger range of loans
I have moved a small percentage of my money over to them to see how it goes.
I know there are many like minded ex FC members and wonder if we all moved to the same small P2P site, whether it is Lending Crowd or another, we could boost that site to our and their mutual benefit,
After the treatment we have "enjoyed" at FC it would be lovely, even for a short time, to be the dogs wagging the tail.
I would add that I have no financial interest in Lending Crowd and that my user name at FC was different to the one I am using now.
Any suggestions or alternative recommendations very welcome
Biscuit bri
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Post by biscuitbri on Sept 9, 2015 12:48:36 GMT
Hi jamesduffin,
Yes, just what I'm doing - for tax purposes our user name is nanniema.
Only thing I've not worked out is how to find the auction closing time as opposed to just the day, but as you say I've only got to ask and will get a very prompt reply
Brian
I am a silly old s*d, just looked again and there it is plain as day
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